China drags the chain

The Detail

Department of Agriculture, Water and Environment (DAWE) live cattle export trade figures eased 26% from the June tally to record 71,451 head transported during July 2021. As the average seasonal pattern for live cattle exports demonstrates, it is not unusual to see a drop in volumes from June to July. Indeed, in 2020 we saw a 46% decrease from 124,241 to 66,946 head.

The current season’s lull places total July 2021 cattle exports 7% ahead of the volumes reported in July 2020, but 14% under the five-year average for July.

Cattle exported to Australia’s largest offshore destination, Indonesia, declined 35% to record just 32,360 head shipped for July. This is the second lowest monthly volume this year and represents levels that are 37% below the five-year average seasonal pattern for July.

In contrast, Vietnam managed to post a 12% gain from June to July with 29,075 head consigned. The unseasonal lift places the current monthly flows to Vietnam 85% higher than the normal levels seen in July, according to the five-year average pattern. Despite the strong showing over the last two months average monthly live cattle flows to Vietnam since the start of 2021 are sitting 8% under the normal seasonal pattern due to a lull in trade over March/April.

Australian live cattle trade to China crashed in July to see no trade reported. However, as the 2020 annual pattern demonstrates it is not uncommon to see the type of variation in export flows to China with volumes over the 2020 season demonstrating a rollercoaster pattern between 5,000 to 20,000 head per month over the year. Furthermore in 2020 January and November also recorded zero flows.

Current market share of Australian live cattle exports has Indonesia capturing 52% of the total trade in 2021, up from 44% in 2020. Cattle exported to Vietnam account for 25% of the trade, down from 28% in 2020. Meanwhile, China has eased toward 11% of the share of cattle exports, down from 13% in 2020.